DOW JONES NEWSWIRES
CF Industries Holdings Inc. (CF) swung to a first-quarter profit
absent charges tied to last year's acquisition of rival fertilizer
maker Terra as its margins soared on higher volumes and prices.
Shares were recently up 3.3% to $133.50 Thursday. The stock has
gained 65% over the past year.
Higher phosphate selling prices and growing demand have boosted
sales for the fertilizer producer, which in February affirmed its
strong outlook for agriculture as high commodity prices encourage
farmers to plant more acres.
Last year's results suffered from a $123 million breakup fee CF
Industries paid to take Terra away from rival bidder Yara
International ASA (YARIY, YAR.OS), but the acquisition has paid off
as the business largely contributed to a 94% jump in overall sales
volumes.
"We entered the year with lean inventories," Chairman and Chief
Executive Stephen R. Wilson said. "We are pleased that excellent
plant performance allowed us to deliver good sales results in the
first quarter and to position inventories for the spring selling
season."
CF reported a profit of $282 million, or $3.91 a share, compared
with a prior-year loss of $4.4 million, or 9 cents a share. The
latest quarter included a net gain of $11 million mostly on the
sale of warehouses, and prior-year results included $136.1 million
in merger-related costs. Revenue more than doubled to $1.17
billion.
Analysts polled by Thomson Reuters expected a per-share profit
of $3.17 on $1.22 billion in revenue.
Gross margin jumped to 44.7% from 25.7%.
Sales in the company's nitrogen segment--its biggest by
revenue--almost tripled as volume climbed 41%. Phosphate sales
jumped 41%, though volume fell 8.3%.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909;
Andrew.FitzGerald@dowjones.com